"...with over 150,000
textile jobs lost
between 1996 and
2006. Over 48,027
apparel jobs were
also lost in the
same period..."

As of November 2008, the Big
Three U.S.
manufacturers, (General Motors,
Ford and Chrysler) indicated to
the United States government
that unless additional funding
could be obtained over the short
to medium term, there would be a
potential danger of the
automakers moving into
bankruptcy. As of this moment,
they are collectively asking for
the amount of $25 Billion (with
a capital "B").

If you are
looking for an industry that has
gone down a similar road as the
"Big Three
United States
automakers", look no further
then the U.S
Textile & Apparel Industry.
Although this industry may
not have made catastrophic
errors in judgment as many would
say the automakers have done,
both industries mirror one
another in many regards. One
very big difference is that the
government did not consider for
a moment giving the Apparel
Industry $25 Billion...

If any industry feels the pain
of the U.S Automakers it
is certainly the U.S
Textile and Apparel Industries.
Over the years, much of the
domestic apparel manufacturing
industry has been stripped away
for obvious reasons. In this
article, I will refrain from
explaining why consumers prefer
to purchase a $5.00 t-shirt in
opposition of a $10.00
t-shirt. But I will share with
you some of the bottom line
effects.

For an
understanding of textile and
apparel job reduction,
below
is some helpful data found
at a Duke University website. Please keep
in mind that below is in
reference to only "one"
state. The numbers would be
amplified if we calculated
the effects across the
entire country (Granted, not
all states were big on
Apparel
Manufacturing). Below is an
example of the negative
effect caused by factory
closings in the single state
of North Carolina.

"North
Carolina's economy
continues to
restructure away
from traditional
manufacturing
industries like
textiles
and apparel. Since
1992, when textile
production
represented 16
percent of total
manufacturing output
in North Carolina
and apparel
production
represented just
over 4 percent, both
sectors have seen a
steady decline down
to about 9 percent
and just over 5
percent respectively
in 2001.1
Over 871 textile and
apparel mills have
closed down since
1996. Between 1977
and 1997, nearly
82,000 jobs were
eliminated in the NC
textile industry.2
This downward trend
has accelerated
since 1996,
with over 150,000
textile jobs lost
between 1996 and
2006. Over 48,027
apparel jobs were
also lost in the
same period
(1996-2006)3Not
surprisingly, North
Carolina recorded a
high unemployment
rate at 6.5% in
2003, ranking 41st
in the nation. The
state's annual
unemployment rate
has consistently
been higher than the
national average
since 2001. In
January 2006, 15
North Carolina
counties had
unemployment rates
more than 2% above
the national average
of 4.8%, all of them
rural.4
In particular, Hyde
County had the
highest unemployment
rate in January
2006, at 8.9%.5

The consequences of
layoffs have been
devastating to
workers, who mostly
reside in rural
areas. Many textile
workers have spent
over 30 years in
these industries,
and have found
readjustment
difficult. A study
by the NC Employment
Security Commission
has shown that of
the people laid off
in 2001, only 59%
found work one year
later, and just 62%
found work two years
later. Of those who
did find work, over
60% earned less than
90% of their
pre-layoff wages.6
This finding is
consistent with
previous studies
conducted in the
late 1990s that only
74% of laid-off
workers were
reemployed after two
years, with the
median wage of these
workers being only
88% of their
pre-layoff median
wage. This trend is
exacerbated for
older workers (over
55 years old), with
findings in two
studies in 1995-96
and 1997-98 that
50-60% of displaced
workers found work
after two years,
with those who did
find jobs earning
only 78% of their
pre-layoff wages.7
This has meant that
many people have
exhausted their
state unemployment
benefits without
finding a new job.
In 2003, this figure
reached 142,000
people.8"

In regard to
GM, Chrysler, and
Ford, manufacturing is not
necessarily moving
"internationally" at the same
significant rate as it did for
textiles and apparel. In the
case of the big three
automakers, it appears that
manufacturing "affordability"
has moved to alternate locations
within the United States (not
only internationally as was the
case with apparel). If Toyota
and Honda are truly producing
vehicles in the United States at
a lower cost of manufacturing
then the big three,
is it feasible for the "big
three" to follow suit?

Unfortunately
it is not simply an issue of
factory location. Possibly, GM,
Chrysler, and Ford
should move to
North Carolina, but at the same
time tell the union that they
actually moved to Alaska...
Or possibly
stay in their current locations,
but tell the union that they
moved to Florida. Hiding from that particular
union may be an industry
saving move... Certainly,
there would be some pain
involved, but possibly this
would start the healing process.

Before
globalization built its
tumbleweed machine, the textile
and apparel industry was
thriving in the United States.
When the domestic manufacturing
environment took a harsh turn
for the worse, I do not remember
textile companies requesting
"BILLIONS" of dollars.

If
GeneralMotors,
Chrysler
and Ford
merged, maybe they could go by
the name of GMCF
which could stand for Get
More Cheap
Financing.
After all, that appears to be
the primary goal of these
companies. Rather then
manufacturing and selling cars,
they are forced into a position
of chasing down funding.
The problem
is that receiving "free money"
now does not guarantee
that a company will "make money"
later.

If someone
asked you if they could borrow
$100. but you
knew that they already owed
$500. to
someone else, would you be
comfortable lending the $100.?
At some point the well does in
fact go dry.

At what point
does one suck up the pain and learn
that if a business "does not
make money", it is not
actually a viable business.

Please do not
get me wrong. I absolutely
believe that if the big three go
bankrupt, it would be
devastating to the economy.
More specifically, it would put
way too many people out of
work. The unfortunate issue is
that the $25 Billion that they
are currently asking from the
government, is "only a portion"
of what they would truly need.
Therefore, are we actually
helping the business
model or simply spending more
money on a car that has already
been dropped off at the dump...

By the way,
when people lose there jobs, they
will work for less money. If
they work for less money,
manufacturers can
produce items at a lower cost
right here in the United
States. If we produce product
in the United States and at
lower cost, people
that actually
have some money
will eventually begin to buy
more products. As we buy
more products, the economy
grows. As the economy
grows, employees ask for higher
wages. As wages gohigher, we will move product
off shore again... The
cycle continues... At
this point, it may be time to
clean the slate in the Auto
industry.

The Apparel
Industry did not receive a
bailout. However, the world
still wears clothing. I have a
funny feeling that if three
automakers do not get bailed
out, we may continue driving
cars. Which means someone has
to make them. Is
it so horrible if the people at
that currently work for GM today
actually work for Toyota
tomorrow. Possibly, that
is bad... Anyway, I hope all
works out well in the end.

It is truly
depressing seeing our country in
such pain. In addition, I am
far too lazy for riding a
bicycle to work.
Hopefully the auto industry
learns to heal its wounds.

The above
article is simply my own
opinion.
I am
certainly not an expert
on the economy nor the auto
industry. These are simply
my own observations.
If you disagree,
sorry.. If you agree, great...